1. Tax
On a workaday Oslo street, I take the lift to the top of an office block, where splendid views of the city, its hills and its water open out in every direction. On this crisp day, we can pick out the Edvard Munch museum, the odd island and the ferry to Denmark.
This is the Skatteetaten, Norway’s equivalent of our Revenue and Customs. I’m here to meet Nina Schanke Funnemark, who is, in Whitehall parlance, permanent secretary: the chief official. An assured 53-year-old, she seems like she’d thrive in the same job in Britain. But in moments, I know more about her than I could ever hope to discover about the average British bureaucrat.
Her aide, Ernst, clicks on a mouse and brings up a screen headed “search the tax lists,” before typing in his own citizen number and his boss’s name. “That’s me” she says cheerfully, as he clicks again, and we’re in—looking at six particulars. Alongside Funnemark’s postal area, municipality and birth year, we can see that her net income last year was 1.78m Kroner (about £129,000), that she paid tax of Kr.742,000 (£54,000) and, last but not least, that her net assets—“after deductions”, she helpfully clarifies—tot up to Kr.4.76m (£344,000).
It is, putting it mildly, difficult to imagine Sir Humphry going naked like this. The most remarkable thing is that I’m not enjoying a privileged peak into Funnemark’s personal balance sheet because of her public position. It’s quite simply the right of Norwegians to find this stuff out about each other.
I had come here on a quest to identify the magic ingredients that make up this equal country. For 2019, the last year before pandemic effects clouded the data, the OECD records Norway as being at 26 on the Gini inequality scale, which ranges from 0 (where everyone has the same) to 100 (where one person has everything). Only the Czech Republic, Slovakia and tiny Slovenia did better among European members of the OECD club. The same year, the Gini for Britain stood at 37, making it more unequal than any major advanced economy anywhere except the US.
Might a society where everyone can know what anyone ends up with exert more discipline on sweet deals at the top and exploitation at the bottom? Might fewer arbitrary gaps between pushy, privileged men and their more reticent, female or working-class colleagues creep into pay structures? More pertinent for Funnemark is that tax dodging is harder if everybody can see whose incomes look awry: “We get a lot of tips every year,” she says, which help determine “who to look into.”
The unique transparency traces way back: the tax authorities were publicly posting individual liabilities as long ago as 1660. Funnemark herself can recall when “once every year we put out these physical books” in separate offices “in every municipality.” That day, “there was always a queue of people coming in, looking into their friends, neighbours and whatever, and they got the numbers.” Some were always “just curious” about, say, the Ferrari next door, or they “wanted to see if their ex-husband had more money than them.”
“When we digitalised, around 2000,” says Funnemark, it was no longer about “the local town”; the whole country “was open for everyone” and “you didn’t have to go down to the office and show your face.” Suddenly, there were so many clicks that nosiness overwhelmed reasonable privacy. Some just wanted to close the lists. But many “still thought it important for Norway to keep them open,” especially “journalists, those concerned with tax crime and the grey economy,” and also many businesses, who like keeping tabs on competitors.
A compromise was reached a decade ago, embodied in a tab on the tax lists homepage—“Find out who searched for you.” The result: “Now he’s been looking into me,” Funnemark says, “when I log on, I can see, ‘Oh, Ernst has been looking into my numbers’.” Conversely, “I wouldn’t look into Ernst just out of curiosity now, because he’d see… so you need a good reason.” Journalists can still search the full lists anonymously but can’t republish them wholesale: there’s a limit of 25 names a story.
The upshot? Annual searches are way down from the extraordinary peak of 16m, to 1.3m. But that’s still roughly one search for every four Norwegians, children included, with roughly one in 10 looking someone up (with 521,000 unique logins). In response, 285,000 people checked who’d probed their numbers. Although the tax chief stresses it’s for politicians to settle the rules, she notes that there’s no longer much controversy. Now “a good middle way” has been found, “all the parties want to continue” the system, she says.
There are still fully anonymous searches for the net takings and taxes of businesses. The Skatteetaten also publishes a comprehensive snapshot of shareholdings each year. Mapping—and closing—the corporate tax gap is easier when you can check these things with a click. The deeper principle, Funnemark says, is transparency in the public culture: “that is the basis” for “an open country where we trust each other.”
2. Work
Frazer Norwell is a razor-sharp kid from a council house in southeast England. Since the demise of local papers, British journalism has had a way of locking such people out. But this 26-year-old son of a jobbing freelance driver is thriving—as editor of the Norway branch of the Local, a continent-straddling online magazine for expats.
Five years ago, Norwell was studying journalism at the University of Kent, ground down by working long hours in pubs through every break to pay his way. But he “met a Norwegian girl,” Isabel, who said to him: “my village has a lot of tourism in the summer: why don’t you get a holiday job?”
This was Hemsedal, up in the mountains 125 miles northwest of Oslo. Skiing and summer hiking ensure thronging coffee shops. Norwell soon “figured out I could work half as much as I’d otherwise have to: doing a full summer was like working nearly six months in the UK. Suddenly I could move from working every hour I could get, to more like standard full-time hours.” There were two student summers, then a working Hemsedal Christmas.
On graduating in 2019, Norwell freelanced at ITV News, putting in all the unsociable hours anyone asked him to, first on the general election, then on the broadcaster’s Covid coverage. But none of the graft counted for much when the news moved on from the virus’s first wave: the shifts dried up. So, with Isabel, he headed back to her family home to “work a season”. “We just went—she was in the reception at the ski resort; I worked in a restaurant.” But there was breathing space you don’t have when you’re grafting for peanuts in a British bar or hanging around and hoping for a gig economy shift. By spring 2021, Norwell was “picking up shifts” with the Local, while Isabel had landed work with NTB, the main news bureau in Oslo. They were ready to make the leap to the capital.
“One of the big differences I noticed” with trying to cut it in London, Norwell observes, “is how affordable the city was.” This is a striking defiance of the caricature of exorbitantly expensive Scandinavia. But the pair wound up in Torshov, northeast of the centre, where, he says, the housing was built for factory workers and yet is “all of quite a nice quality, with a lot of shared green spaces.” Just 15 minutes by tram from the “absolute centre, in a safe neighbourhood, with a balcony. We pay around £600 each per month. If we tried to find something similar in London, it would be impossible.” (Googling suggests similar rentals in, say, Hammersmith go for twice as much.)
Most Norwegians own, Norwell explains, while those who rent overwhelmingly sign long-term contracts, with rent rises capped at inflation. So if—like him—you’re happy with an informal, one-year let, there’s scant competition. A wise landlord won’t take the mick.
Norwell takes me to a cavernous beer cellar with a roaring fire, and on to bustling boho Grünerløkka, in the east end of the city. Plans aren’t set in stone, but three years in, he’s talking about how much longer he’d need to stay for permanent residency rights. His decently paid casual work gave him an invaluable platform to build on. This sounds like a heartening story for Britain, where the national minimum wage has been rising, but here Norwell reveals a twist: “Norway doesn’t have a minimum wage.” Instead, footloose workers, such as his younger self—temporary, frequently foreign, and certainly not unionised—can be indirectly protected via union agreements.
Magnus Marsdal, head of the union-backed Norwegian thinktank Manifest, explains how it all works: “The reason we don’t have a minimum wage” is precisely “the strength of the unions. We negotiate from our own power base. We don’t want parliament meddling, to be beholden to their shifting majorities… we want the strength to be our own strength.”
This argument sounds bizarre to 21st-century British ears, but during their postwar heyday many UK trade unions were similarly opposed to any legislation, including for minimum wages, encroaching on “free collective bargaining.” And back in the late 1970s, when half all British workers carried a union card—exactly as half of Norwegian workers do now—our own income gap was far smaller, and comparable to Norway’s today.
Today, by contrast, fewer than a quarter of UK workers are unionised. And the sharp cross-country variance in membership understates the difference in clout, because of all those, like the younger Norwell, who are protected without paying subs: UK total collective bargaining “coverage” is just 27 per cent; the most recent figure for Norway is 69 per cent.
So how did Norway’s unions manage to sustain an independent strength that proved unsustainable in Britain? Well, Marsdal explains, everything in Norwegian industrial relations is “very controlled,” meticulously balancing “workers’ power over bosses,” ultimately through the threat of strikes, with “the self-restraint of strong workers.”
There is “a lot of finesse to the coordination. Export-orientated industries negotiate first, because you can’t have a wage beyond what can be supported by world markets. These [sectors] are also the drivers of productivity, so they set the roof for those that follow.” Of course, there is tension when others resent that pay ceiling, but also collective acceptance that everyone grabbing what they can will end badly: if there’s a sudden boom in one industry, its workers “can’t just run with it” and cash in. The regime is “a way of expressing and containing class struggle.” It is ultimately “the main reason why we have the ‘compressed’ [spread of] incomes we do.”
The law is only allowed to intrude where unions are exceptionally weak. If, say, “cleaners in the private sector aren’t able to organise,” Marsdal says, then “a sort of minimum wage” is created, but—crucially—it still “comes from collective bargaining.” Parliament empowered a panel of unions and employers to identify a “situation [as] out of control” and institute the wage floor that’s written into the union contract as law. This is only “a stop-gap thing”, a response to hopefully passing problems with unions gaining a foothold.
Up in Hemsedal a few seasons ago, Norwell and his coffee shop colleagues might have had only a sketchy sense of how all this worked, yet still benefitted from it. The enlightened self-interest of unions protecting people who aren’t their members, but who could—potentially, eventually—threaten those who are, is very different from the complacent selfishness for which the post-war British unions were often mocked, for example by Peter Sellers in I’m All Right Jack (1959).
Could 21st-century Britain muster some Norwegian spirit? “Of course, in a more dire situation,” Marsdal muses darkly, the best option might just be to hike the minimum wage. But when you’ve still got mighty unions, the smart approach is utilising them in a way that—in the most Scandinavian phrase I heard—“pays attention to the totality.”
3. Welfare
In the pillared hall of an old savings bank, Christiania Sparebank, Norway’s Labour and Welfare Administration (NAV)—its equivalent of our Department for Work and Pensions—assembled for its annual conference.
The big difference between NAV and the DWP in my mind concerned the rates of payments they administer. Summary numbers can obscure a lot in complex welfare systems, but just consider the gulf on basic unemployment benefits: they replace 62.4 per cent of average earnings in Norway, against just 12 per cent in Britain.
As soon as I arrive, though, another difference is palpable—ethos. In Britain, jobcentres were actually caught targeting numbers of punishment “sanctions” a few years back; disabled claimants have come to regard their conversations with the DWP as akin to being interviewed under police caution. Just like the DWP, NAV has a difficult job which involves applying complex rules, and frequently ends in saying no. But, from the moment director Hans Christian Holte kicked off proceedings, it was evident he wanted its staff to understand the gravity of their decisions for people’s lives, to think about how alienating bureaucracies can be, and to keep an unflinching eye out for signs of distress.
Amid an “expensive time” for families, Holte raised concerns about food insecurity and people skimping on dental checks. Where Whitehall now systematically short-changes large families through the two-child welfare limit, Holte rallied staff to the plight of a woman with nine kids who was “ready to give up,” despite “having rights she hadn’t used.” He hailed officials who’d met with her and secured her housing and other entitlements. “How do we succeed?”, he asked his troops. “Through close follow-up and time spent,” he answered himself.
Schmaltzy videos reinforced the message: at one point, if I caught the translation right, we heard about a poor child sobbing after missing out on snowboarding. Such modest privations were invoked as a spur. “I’m smiling,” said one charming staffer, “when I know I’ve helped a parent get less stressed.” Instead of the DWP’s catch-you-out culture, officials were urged to understand that clients arrived in a moment of vulnerability and could struggle to identify—let alone assert—all their needs. The crucial thing, one cheery official explained on the screen, is that you don’t leave vulnerable people “until you’ve got the form finished and the envelope sealed.”
It was starting to seem Brave New World-ish—“Every Norwegian is happy now.” Fortunately, the programme included bracing reality checks. The stage was given over to Ole Martin Hafsmo, a journalist who has made an award-winning (and funny) podcast about his mother’s impoverished life in a corner of Trondheim. The show and the neighbourhood are called Skitbyen (Shittown), because the houses were originally built for sewage workers.
Hafsmo said his mother, whose wicked chuckles we heard over the speakers, was shuddering at the thought of him walking into the lion’s den of NAV’s Stasi-like bureaucracy. She prefers almost any privation—even having the electricity cut off—to submitting to the paperchase and bank statement inspections required for emergency assistance. This is the proud, sometimes perverse, human psychology that means-tested benefits always run into—a barrier which few officials compute. In Britain, the issue is far bigger, because more payments are “targeted” and fewer are paid as of right. By giving the problem an airing, NAV won’t wholly fix it, but is at least moving beyond denial.
I had been invited to speak to the conference about Britain’s poverty crisis, and later noticed officials referring back with shock to my charts about rising malnutrition diagnoses and my photos of tents on our streets. The DWP could, but wouldn’t, invite an American over to warn staff about the many horrors that will come our way if we can’t hang on to what remains of our own welfare state.
As it is, during the very hours I was inside the hall, Chancellor Jeremy Hunt was trailing plans for harsher sanctions on supposed layabouts. He set out the detail a week later: Britain’s vanishingly small number of long-term unemployed people would have their benefits entirely cut off if they declined unpaid work placements. The government’s own figures showed that the bureaucracy involved in this shin-kicking stunt for “hard-working taxpayers” would actually cost the Exchequer money.
4. Society
Impressed as I had been while inside the welfare state, I still wondered who fell through the gaps. So the next sub-zero morning, I headed for a foodbank. Outside Grønland Church, a line of people in hats and thick coats—mostly older, stocky women—recalled a Soviet bread queue. As I got closer, so did the sound. I heard no Norwegian. My English questions got no reply, bar the odd nod in response to “Ukrainian?” The one exception was 33-year-old Viktor from Lviv, who said life was “OK” for him and his mother; the authorities had “given us some money and said to come here for some food.”
Inside the Church, I find music, warmth and a pair of middle-age Norwegian women making sure everyone has a hot drink before it’s their turn to brave the cold queue. I ask one of them, Katrina, what denomination the church is. She hasn’t a clue: “We’re just here to help the refugees.”
Over the road, I work my way into the little warehouse where the food parcels are packed. Amid tottering crates of apples, greens, yoghurts and tomatoes, I catch Tove, a stalwart of this well-established charity since 2011. She frets about the lack of bread and butter amid her healthy offerings. Rising food costs and the influx of Ukrainians are straining supplies, she says: twice-weekly sessions had been cut to weekly. Also donning the charity’s reflective pink vests are Hedda and Leander, two young women brimming with confidence—and perfect English. How did they get involved? “We’re only here for our company’s pro bono day,” says Hedda. “Normally we work for the devil,” chuckles Leander: “we’re consultants.”
This outing suggested some striking things about poverty in Norway, which were confirmed when I popped into an old school building just round the corner, where Tone Fløtten—who’s studied charitable food distribution for 20 years—heads the research foundation Fafo.
Despite Norway’s traditionally low poverty rate, food has always been costly, and charities have been doling it out since the 1990s, well before foodbanks became a feature of British life. This began as a Big Society impulse—the genuine kind, not the cover for cuts that this phrase became while David Cameron was prime minister. Churches, the Salvation Army and self-support groups sought to help the most marginalised. Above all this meant “drug addicts,” Fløtten says, but also odd others who slipped through the net, perhaps because some mishap had interrupted social insurance contributions, forcing recourse to lower, non-contributory benefits. The clients almost always had a special need of some sort, so were offered counselling, housing and more: food was “part of a wider system of support.”
What’s changed since—and pushed headline poverty up—is simple: immigration. There has been steadily rising diversity for a long time, and now the great influx from Ukraine. The poverty rate is still just 12 per cent for native-born Norwegians, but more than twice as high—26 per cent—among other residents. The change isn’t the incidence within either group, Fløtten explains, just the burgeoning size of the second.
As many as 75 per cent of Norway’s foodbank users are now foreign-born. (In Britain it’s the opposite: even though we deny most asylum seekers both benefits and the chance to work, 72 per cent of our destitute population are UK-born.) “More Ukrainians are coming here than to Sweden, Denmark [or] Finland,” Fløtten says. They have many fewer special needs than the traditional clients and are mostly—like Viktor—“healthy persons who just need food.”
The challenge of absorbing so many dispossessed people who can’t speak the language is real, and since my trip Oslo has tightened up on the support it provides, especially for refugees without children. But the basic emphasis on integration in the approach that Fløtten described remains. The municipalities, she explained, first have to provide the newcomers with “somewhere they can stay, plus basic services like kindergartens and health.” After that, adults “go on to a full-year, full-time introduction programme”: learning Norwegian and about Norway, plus education and training to help with finding work. They “get a bit more than on the basic social benefits for turning up,” although the income is still pretty basic, and so—with groceries costly—they’re advised to top up at foodbanks.
Reflections
Some of the very latest numbers point to a modest rise in Norway’s inequality. There is, to be sure, one looming threat to fairness here—as in so much of the world—in the rise of private wealth. With Oslo trying—and so far struggling—to tilt the tax burden towards capital, a few scores of ultra-rich Norwegians have fled to Switzerland. Flying home, though, I reflected that even if this is one problem Norway hasn’t yet solved, it has at least been trying: more than can be said for us.
I moved on to mulling two common explanations for Norwegian exceptionalism. First, the idea that this is now a welfare state lubricated by nothing but oil. The sovereign wealth fund, which invests oil profits, is indeed vast: its bounty is covering around 20 per cent of the 2024 government budget. But when I’d started fantasising about how UK social security might be transformed with all that free money, think-tanker Magnus Marsdal had insisted it wasn’t fundamental. Yes, energy sales bring in foreign currency which Norwegians will eventually be able to spend on imports from the rest of the world. In an example that neatly sums up both the balance of payments story and the undoubted oddity of tapping fossil fuel wealth in order to thrive through the green transition, Marsdal explains that his compatriots are effectively “swapping barrels of oil now for Teslas in the future.” Which is great, but as for “what we do with redistribution domestically, those [oil] dollars don’t really do that.” Saudi Arabia is proof that petrodollars do not an equal country make. And there’s a telling comparator closer to home: the peak of UK North Sea oil revenues in the mid-1980s was followed by a great splurge of tax cuts, especially at the top end. There’s something else about Norway which ensures that its largesse is prudently and fairly deployed.
Others look not to oil but demographics for the magic ingredient, suspecting that the exceptional social protections of Scandinavian countries have been underpinned by their traditional—and now threatened—homogeneity. There is a certain smug insularity. One official made a telling quip: “If you’re Norwegian, and you don’t take heroin, you’ll probably be OK.” Others exuded satisfaction that Norway had avoided Sweden’s mistake of taking too many Syrians. And indeed, Oslo is now moving to curb the new immigration, so prominent at the Grønland foodbank and in the poverty numbers. But the fact that recent cutbacks have affected provision for refugees’ pets and back-payments of unclaimed child benefits only underlines the generous starting point.
There are certainly also some real labour market challenges: Marsdal worries about “Mexicanisation”—that Norway might wind up dangerously segregated like the US, with an underclass of immigrant workers.
But he also highlights his country’s record in adjusting constructively. Initially, the 2004 eastward expansion of the European single market made it “impossible to uphold [employment] standards: there were just too many people willing to work for less.” Rather than accept a race to the bottom, however, Norway introduced that statutory “stop-gap” minimum wage in threatened sectors, benefiting natives and newcomers alike.
So, while I left with no doubt that rapidly rising diversity is imposing practical and political strains, I also felt optimistic about Norway’s ability to adjust to it without sacrificing its traditional egalitarianism. Hardship overwhelmingly affects newcomers, and yet the concern of Norwegians was palpable. It was there in Tove’s years of organising foodbank supplies, in Katrina’s godless hours in the church, even in Hedda and Leander being granted a day off from consultancy to pack food boxes.
The real underpinning for equality, it seems to me, is the thoughtful culture that enables strong egalitarian politics. Some have traced this supporting culture back in turn to way before Scandinavia was actually equal, to the early mass literacy demanded by Lutheran religious practices. But regardless of its origins, I saw this thoughtfulness made manifest again and again: in the transparent tax system; in the regard unions show for non-members; in the attitude of the welfare officials. I saw it too when, whatever my question, I was pointed to a government-backed study which had probed the issue in depth.
Having studied poverty since it was a marginal issue in Norway, Tone Fløtten says the shock of its arrival at scale has jolted politicians out of their complacency. Today, “it’s a really big issue: all politicians have to say ‘poverty’ at least three times a week… All governments,” right or left, “feel the need to have some sort of action plan… In almost every area in Norway you’ll find redistributive ambitions: labour, housing, consumer, education, health, especially children’s services.” Everywhere, she says, Norwegians try to “explore and level-out the differences from day one.” She’s no shrill patriot, and yet there’s pride as she admits: “I think it’s quite a beautiful system.”
